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5 Ways the Workforce Will Change in 5 Years

Five years isn't a long way away, but human-resources experts predict significant changes within the workforce over the next half-decade.

A sizable shift is coming as millennials take their seats at businesses large and small, and Baby Boomers simultaneously either retire or modify their work styles to reflect increasingly flexible and mobile opportunities.

To get some answers, we spoke to analysts from different business and staffing sectors. With their expertise, a picture of what business leaders — and employees — can expect from their professional landscape emerged. Here are five key points from that conversation.

1. Freelance employees will approach the 50% mark

The freelancer is on the rise, and if you ask proponents of the "contingent" (freelance) economy, they expect that by 2020 some 40% of the workforce will soon be made up of contract-only employees. "This is in part because millennials don't want to stay in one job forever, but also in part because companies prefer to try out employees before committing to them," says Stephen Robert Morse, co-founder of SkillBridge, via email. "These changes will affect the white-collar economy, just as they have already disrupted the blue-collar economy (e.g. Uber)."

2. Flex-work becomes a new normal

We already live in a largely work-anywhere world, thanks to the cloud and mobile tech, but shifting employee demographics will drive further alterations to the way we think about clocking in. "By 2016, 63 million Americans will be working in a virtual or flexible role, up sharply from 2010's 34 million," says Ellen Grealish, co-founder of FlexProfessionals. Business leaders can expect millennials to account for some 50% of that workforce by 2020, but she also sees a growing incidence of Boomers who are close to retirement but who keep on working to some extent — often from offsite. "The demand and creation of flexible-work options will continue to rise over the next five years," Grealish says.

3. Career 'impatience' a driving factor

A recent Georgetown University study showed that millennials already switch jobs some 6.3 times between ages 18 and 25. Only 1 in 10, according to the report, considers their current job to be part of their career. "In other words, companies are not prepared for the millennial generation's impatience," says Pamela Stambaugh, founder and president of Accountability Pays. Throughout the next five years, employers can expect to see talent land, learn, lift off, and then move on with greater frequency than that of their Generation X and Baby Boomer predecessors.

4. The new workforce works small

Recent monthly employment numbers from ADP show that approximately 65% of all new non-farm jobs created are coming from small and medium-sized businesses. Especially hungry for new talent: High-growth small shops within the technology, health care and social-media marketing sectors, says Robert J. LaBombard, CEO of GradStaff. However, some of this SMB job creation is due to Baby Boomers who are retiring from their posts at older companies — a phenomenon expected to continue for up to 15 years.

5. Gen X may have its day

As Boomers step aside, or decrease their engagement with the companies at which they remain in a part-time or flexible capacity, the 34- to 49-year-old set stands to reap new opportunities. Their experience relative to millennials should prove an advantage. "However, as a smaller demographic group, there will be a shortage of qualified workers in this age bracket, so companies hiring will have to hire more at the entry-level to compensate for the loss of Baby Boomers to retirement," says LaBombard.

These five factors that employers and employees need to heed in the coming 60 months each deeply relate to one generation aging out of career-building efforts and another phasing into their own. But what can companies do to prepare for these changes? Strategies lie in responding to the cultural and technological elements of the predicted shifts.

Take these strategies with you to your next long-term planning meeting.

Change workplace culture to retain talent longer. "Companies should be motivated to enable millennials to take over their own career paths within their employer's system since voluntary turnover is very expensive," says Stambaugh. That means, in part, engaging millennials early on and influencing their decisions to stay on with the organization via job-growth incentives and personal-development opportunities. Allow your employees to become experts. Encourage them to ask for new roles and rotate them into freshly challenging new titles. Of course, it also means succession planning that absorbs some of the impact, if (and when) they do move along.

Further arm your workforce with technology. Mobility trends will not be exclusive to staff who are able to do their work offsite. Onsite staff also expect their mobile devices, tablets, laptops and other technology to synch with work-related tasks, wherever and whenever they need them. From the living room to the conference room, the workforce expectation is about connecting, collaborating and adapting to the multiple workspaces to which tomorrow's employees are accustomed.

Cultivate new leaders to forestall a leadership gap. As Boomers leave, or change roles, and Gen Xers fill what gaps their numbers allow, organizations must identify and grow leaders from the ranks they already enjoy. Furthermore, employees should ask after mentorship. Mentees learn more quickly than by experience alone, and mentors within a company become experts regarding where knowledge and leadership gaps exist, and how quickly they're likely to be filled. It's a win-win scenario.

There's a sea change, then, happening in the workforce. As the next five years unfold, the way that change reshapes the contours of business will become more and more pronounced.

But the good news is that most of the transformations predicted lead to fresh opportunity and positive adaptation. With a little foresight and a healthy dose of faith in the talent with whom we work, 2019 should shape up to be a time of empowerment for employers and employees alike.

How has your workforce changed in recent years? Tell us in the comments.

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